Credit Suisse facing giant writedowns

8 January 2008

The value of Credit Suisse fell by the largest amount in three weeks after the press reported that the Swiss bank is likely to announce further writedowns for the fourth quarter.

Credit Suisse fell by 2.6 percent in Zurich trading, making its market value now $66.7 billion.

Analysts expect the bank to be forced to make writedowns of at least $2.2 billion in the final quarter due to its investments in US malls and leveraged buyouts, Sonntag newspaper reported.

Credit Suisse has already made $1.9 billion of writedowns in leveraged loans and commercial mortgages in the third quarter.

Swiss rival UBS last month announced writedowns of $10 billion in the fourth quarter of the year.

So far Credit Suisse has escaped the worst of the sub-prime mortgage crash compared to US banking giants and the bank's chief executive officer, Brady Dougan, last month said he was confident of the future.

However, shares in Switzerland's second biggest bank did take a 19.7 per cent tumble last year.

Credit Suisse will report its fourth-quarter results on February 12th.